Insurtech trends to watch in 2020 and beyond

Image from the “TechLife” collection by Karthik Srinivas

The insurance industry has been a bit slower than other financial industries to adopt new technology. While “FinTech” has been exploding, with start-up digital banks popping up all over the place, insurtech (Insurance Technology) has moved more slowly. Technical disruption to insurance industry norms has been, largely, minimal.

But it will not stay this way for long…

Insurance companies who can see the value of technology and use it to create easy to understand, accessible products can use technology to thrive. The competition knows this. And competition to insurance companies may not come from traditional sources. Tech companies, with their unparalleled customer analysis capabilities, are watching the insurance market very, very carefully. They’ve already entered the banking sector, so insurance could be next…

But how can insurance companies stay ahead of the competition and remain adaptable in the face of disruptive forces? We’ve looked at some insurtech trends that insurance companies need to be aware of, and put in place, to stay ahead of the curve.

New customers, new needs

While the treat to insurance companies from big tech is very real, it’s customers who drive disruption. People drive change. Brand loyalty can’t be relied upon when people are continually being given new options on a daily basis.

Giving people what they need, at the right time, is a core tenet for any business in the digital age. Insurance is no different.

So how can insurers make the lives of their customers easier? How can they be there, exactly when needed?

The user experience of an insurtech product is central to this. While it’s true that an insurance product needs to be very easy to use, this also includes the proposition itself. The rise of micro insurance policies such as personalized health plans using the customer’s own biometric data are proof of this. Pay-per-mile car insurance plans also fall into this category.

Insurers need insurance products that speak to people’s daily needs. But they must also consider non-insurance products as a “value add”. This helps promote customer loyalty.

Extra services and perks enhance an insurance company’s relationship with its customers. Prompting them to stick with them, even in a competitive market.

A Digital transformation roadmap

Digital Transformation – It’s time to adapt

Great technical innovations also pose grave threats to the traditional insurance model.

Transformation does not just mean creating a fancy website or new app. It also means rethinking how the current model works. Both for customers and for the insurance companies.

Refreshing the existing business and just moving it online is not enough. How the business operates internally, combined with new technology, will needs to be considered. Insurance companies have to think in a more “customer-centric” manner to maintain their position over the next few years.

Legacy insurance players need to change their business model. Moving away from silos to connected and highly aligned teams. This will help them to focus on the customer and their experience with the brand.

Technical change isn’t a matter of ones and zeros. It’s also involves a cultural change within the organization.

But help is at hand. Once an insurance company has decided to embark on a program of digital transformation, companies like MAQE (talk to us via [email protected]!) can help to define problems, aid organizational design and ideate customer-centric solutions.

Insurtech chatbots
Photo by Alex Knight on Unsplash


If you’re a global insurance company, customers never sleep.

Luckily a chatbot doesn’t need to get 8 hours a night to provide great customer service.

Companies like Lemonade have leveraged AI and machine learning (more on that next…) to create Maya. An AI bot that can help create insurance products for customers.

But chatbots are not only used for customer onboarding. They can also be used to pay out claims. Claims can often be a pain point for insurance customers. But by making the claims process instant and painless, you’ll delight your customers and elevate the perception of your brand.

AI and machine learning in Insurtech

AI and Machine Learning

The future is already here.

The fastest insurance payout in history happened in 2017. It took 3 seconds for an AI bot to check a claim against the policy, run anti-fraud algorithms and then pay out the claim.

Giving customers this level of service will become essential. Not in a decade, but in the next 2 years.

AI and machine learning can be used in onboarding, to create a very quick and engaging experience. And, as we’ve seen above, it can be used for claims settlement. But AI can also work in underwriting, fraud prevention and anti-money laundering. Using AI to produce personalized pricing using biometric data could also be viable.

AI can also yield benefits for insurance companies who use it for internal purposes. For example, if a member of staff is out sick and needs help, an AI bot can provide a contact point to help them. This is particularly effective for people who may suffer from mental health issues. Talking about mental health can have a stigma attached to it. So many members of staff may prefer to communicate with a bot while they are getting better than a line manager.

Insurers that are slow to embrace the benefits of AI will find that their business is vulnerable to disruption.

Insurtech drone damage assessment
Photo by Goh Rhy Yan on Unsplash

Automated damage assessment

Many car insurers use images from customers to assess vehicle claims. This again touches on AI, with the use of sophisticated image recognition algorithms.

But climate change is very real. And it will pose bigger and bigger challenges to insurers over the next decade.

The fires we’ve seen raging in the U.S. and the tropical storms and disasters that have affected ASEAN in recent times could become more frequent.

If the worst happens, it could be impossible to send insurance agents out to a site to assess property damage.

Drones are now being used by insurance companies to assess property damage claims in areas torn apart by natural disasters. Again, combining this technology with AI will result in instant claim payments to people that need it the most.

Insurance policies and contracts image
Photo by Scott Graham on Unsplash

Micro policies, macro implications

Due to the increased threat of climate change, people will likely need to make more frequent and bigger insurance claims than before.

So smaller, more personalized insurance products are a great way to give people the cover they need at a price they can afford.

Insurtech is revolutionizing this sector. Micro insurance policies are already in use, protecting vulnerable people. But technology can offer even greater benefits. With more personalized policies to help protect vulnerable customers.

Insurers that offer 5 micro-polices that provide good cover at an affordable price, are more likely to get new business.

The opposite is giving a customer one giant policy, with premiums to match, they can’t afford. That approach isn’t sustainable in the digital age, where people have more choice.

Connected devices and insurtech
Photo by BENCE BOROS on Unsplash

Connected devices and insurtech

The internet of things is here and more of us are using connected devices. From smartphones, smart watches and speakers to connected cars, we all generate huge amounts of data everyday.

Currently there are four digital ecosystems that should be of interest to any insurance business. Connected automobiles, smart homes, health and B2B commercial. Each of these ecosystems are at different stages of maturity and each one has different dynamics in play. Such as, for example, differing regulatory frameworks.

It’s vital that insurers integrate their products and brands into these new digital ecosystems.

Connected technology helps insurance companies to more accurately determine risks. Car insurance has relied on indicators such as age, address and credit scores of drivers. Now they have more data on actual driver behavior, such as how fast the car is driven, to determine premium prices.

Connected devices also open up huge engagement opportunities for insurers that did not exist before. Direct contact with customers has been historically limited to onboarding, extensions and claims. Now connected devices and the internet of things could give insurers brand new opportunities to engage with their customers.

With increased engagement, insurers can use these opportunities to add value and increase customer loyalty.

Personalized perks for good customers can increase positive perceptions of an insurance brand.

Compliance implications
Photo by Markus Spiske on Unsplash

Compliance Implications

Regulators are paying very close attention to digital transformation and these advances in insurtech.

Bodies like the OIC in Thailand pay close attention to e-KYC processes and onboarding. But the general landscape for things like AI is a bit more unclear. Changes in regulatory oversight in many specific aspects of insurtech are, as yet, unknown.

But insurers need to work closely with regulatory bodies to ensure that customers are fairly treated at all times.

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How MAQE can help

MAQE has specialized in transformative commerce solutions for many years now. We’ve worked in insurtech for a while. We are well-versed in the insurance environment and regulatory frameworks both in Thailand and around the world. So if your insurance business needs help adapting to some of the trends outlined above, talk to us at [email protected].